Of all her brothers Henry’s sister, author Jane Austen, felt closest to him, who became a banker and, after his bank failed, an Anglican clergyman. Henry was also his sister's literary agent. His large circle of friends and acquaintances in London included bankers, merchants, publishers, painters, and actors: he provided Austen with a view of social worlds not normally visible from a small parish in rural Hampshire.

Henry Austen's bank failed in March 1816, depriving him of all of his assets, leaving him deeply in debt and losing Edward, James, and Frank Austen large sums.