The star has donated the full amount of his £25k honor cash to the MVT, which functions to preserve the UK's independent music venues.
Fender was given the award on October 16 as his third album his work was chosen as the top album of the previous year.
The musician has chosen to give the cash to the MVT, in appreciation of the vital role grassroots venues fulfilled in his initial steps.
"I personally couldn't be pursuing my current career if it hadn't been for all the gigs I did around the area, and further afield, when I was beginning," stated the artist. "These spaces are iconic, but they are in difficulty."
From early 2023 onward, over 150 of these locations have permanently closed – about one-sixth of the whole industry in the UK.
In the last year, top acts such as Pulp, Coldplay, Katy Perry and Ed Sheeran have all backed the Music Venues Trust in its initiatives to support the industry, by applying a small levy to their ticket prices, which benefits smaller concert halls.
Fender also took part, generating in excess of £100,000 on his live tour to support 38 small stages across the UK.
These funds supported venues that were facing potential shutdown due to challenges caused by flooding, blazes and bereavements, as well as licensing issues, conflicts and sound issues.
Additional spaces were granted financial assistance in improving facilities and sound and lighting systems that helped musicians and concertgoers.
"The concept that money from concerts in big venues supports the local stages, where it kicks off for performers like me, is just logical," Fender has said.
He is not the first artist to donate his Mercury Prize prize money to charitable organizations.
In Pulp won the prize in the year 1996 for their album their work, lead singer the singer declared that the band would give their cash to the organization War Child.
In 2002, rapper and singer the artist split her prize between several good causes, including the children's charity and a charity for Sickle Cell.
"And I contributed a thousand pounds to the center, to their gymnastics class, because I did gymnastics when I was younger and they required updated gear," she told the media.
Previously, the band contributed their funds to the youth organization that supported their group, alongside other independent music bodies.
Also 1994 winners M People donated their prize to a charity for MS after a friend was diagnosed the illness.
"Winning was ample," stated artist Small. "The cash was the extra but we didn't need the bonus, because we had the main prize. So our winning impacted the lives of others."
Last week, the MVT shared it had protected two small stages in that region, by bringing them into community ownership.
One venue in the city and the other in Bristol were purchased under the community ownership initiative, which is funded by the arts council and supporters who purchase "stakes" in the properties.
