This paper examines financial liberalisation in Indonesia and South Korea during the 1980s and early 1990s. The paper provides a brief discussion of a pre-reform political and economic environment in two countries, followed by a description of the state of the pre-reform financial sectors in both countries. The paper then focuses on the respective financial development policies and their pace, sequencing and outcomes in the two nations. The socio-economic impact of financial sector reforms is also carefully considered. The paper concludes by summarising its main findings and drawing out some major policy implications.