I just ran into this issue. I sought to add my card as Apple Pay for Apple ID payments. Everything I read, which included news reports from when the feature was added to Apple's own article "Payment methods that you can use with your Apple ID" suggested that the Add Payment screen should auto-populate "FOUND IN WALLET" with the credit cards already added to Apple Pay.
It showed the cryptic message that no eligible Apple Pay cards were found and to "make sure that your storefront matches the card(s) in your wallet," which I interpreted to mean that the store region must match the card issuer and billing address (USA in my case).
I have 12 cards added to Apple Pay. Surely at least one of them was eligible, right?
I thought perhaps the ZIP+4 in my address might have been an issue, as I've found that some stores throw an error when I've tried to pay with Apple Pay and a 9-digit ZIP. (It doesn't tell you the reason but simply fails.) So I changed my ZIP to 5 digits, but I still couldn't add existing cards to my Apple ID for payment with Apple Pay.
I found this thread about the issue and manually added my card, at which time it asked me to link the card to the card already in Apple Pay. So now it's working.
I'm not certain that screen is working correctly. It doesn't seem to behave as the text on that screen suggests. I wonder if cards auto-populate for anyone who doesn't have Apple Card.