Graphics Card Update for 2016 iMac

The graphics cards in iMacs are not upgradeable. There were Late-2015 and Mid-2017 iMac models but none as 2016 models. You can confirm by choosing Apple () menu : About This Mac and looking at what is in parenthesis on the product description line.

Apple may or may not have released newer graphics drivers for the above Macs in newer releases of macOS. The Late-2015 models can upgrade as far as macOS Monterey (12.*) and the Mid-2017 models to macOS Ventura (13.*).

How to download and install macOS - Apple Support

No 32-bit applications are supported after macOS Mojave (10.14.*).

Starting in 2012 with the new "thin case" design, graphics hardware on "cards" disappeared. To save space Apple made the gfx hardware integral with and soldered to the logic board. No iMac after 2011 had slottted gfx cards.

Specs from the MacTracker database for how that model was configured show one basic and one optional gfx version.

The option had to be ordered that way, not upgraded later. You have the entry level version.

However....

these are Adobe's current requirements and your Mac and gfx hardware meets them:

https://helpx.adobe.com/photoshop/system-requirements.html

All Macs made in 2012 or later have Metal support, and yours has a bit more than the minimum VRAM, making me think something else is afoot here. There is a crippled 2017 21.5-inch for bulk buyers whose Intel "on the CPU" gfx hardware is not supported but, from your post, you clearly have the better 4K with discrete graphics.

Any anti-virus, "cleaning" apps or other fearware installed?

Update the card or the driver?

We need to know the exact model of your iMac, but generally graphics cards are integral parts of the machine and can't be replaced.

the video card driver is part of MacOS in most cases, and not sure if any of them (intel, amd, nvidia) offer download of the video card driver separate

read posts from people every now and then who get errors from stuff like 3d apps saying cuda blabla no supported on amd (and I assume intel gpus) because the cuda stuff is nvidia only

maybe this is a similar thing that Photoshop somehow support some nvidia gpu feature which your amd card does not have, and their info is just vague, if it was me then I would try their forums