Apple pay
I have always had PayPal linked to my ApplePay. Now it won’t let me use it. It says I need to verify my PayPal account. I contacted PayPal and they said the problem is on your end.
iPhone 11 Pro Max, 15
PayPal
PayPal cannot be used with Apple Pay but you can use it for a payment method for your Apple ID but you will have to verify each and every transaction. Payment methods that you can use with your Apple ID - Apple Support
Apple Pay participating banks in Canada, Latin America, and the United States - Apple Support