"Hacker following you" pop up on my iPhone

The pop up was a scam designed to trick the user into buying useless software that will do nothing to help protect the phone.

Happens all the time. Expect more like it to appear.

Is there a possibility that her phone is infected?

No

I told her do all ios updates and remove credit cards.

Always a good idea to update. No need to remove credit cards unless suspicious activity is detected. Log directly onto the credit card site. If anything is amiss, you will see it immediately.

No. Her phone is not infected, but she should check to make sure she does not have a paid subscription to the app and cancel it if she does.