The House of Representatives Economics Committee announced this week that it will conduct an inquiry into the Government's planned changes to legislation covering credit cards. In March, the Treasurer released an exposure draft of the National Consumer Credit Protection Amendment (Home Loans and Credit Cards) Bill 2011, which introduces a requirement for lenders to provide a key facts sheet with home loan and credit card contracts.It also contains provisions that regulate the approval of spending on credit cards above the credit limit; restricts issuers from making unsolicited invitations to increase credit limits, and specifies an allocation hierarchy for payments, so that credit advanced on higher rates is repaid first.The most controversial aspect of the bill relates to use of cards above the credit limit. A credit provider will be allowed to approve purchases that would result in the credit limit being exceeded, but this buffer will be limited to a 10 per cent default. Credit providers must not impose fees or charges, or a higher rate of interest, on the consumer as a result of the card exceeding its limit.The effect of this is that consumers can exceed their credit limit provided they stay within 10 per cent of the limit, and they cannot be charged any additional costs for this.A consumer may elect not to have the option of a default buffer. Where they have made such an election, credit providers must not approve the use of a credit card in excess of the limit. A credit provider can decline to offer a default buffer.Credit providers must keep records of elections and withdrawals by customers.Regulations may provide for a supplementary buffer to apply above the standard 10 per cent buffer. The credit provider is not prohibited from imposing fees or charges, or a higher rate of interest, where the use of the card is covered by a supplementary buffer.Banks have already objected to the application of the new rules to all cards and not just new ones. They have also complained about what they describe as a "mandated" buffer - in effect, an additional 10 per cent limit.Other comments on the exposure draft included complaints that the supplementary buffer provisions are too complex and that the record-keeping requirements are onerous.The committee is inviting submissions. The deadline is today (May 20). It will hold the first of its public hearings in Canberra next Wednesday.