Why do we have to add a payment?

As Apple says in the Support Article: "You might need to have a valid payment method on file, even if the app that you want to download is free."

If you can’t download or update apps - Apple Support

Many apps contain in-app purchases that allow you to download the app for free, but also have options for purchasing within the app. Developers have to pay each year to have the app in the store. It also costs the developer time and money to make the apps as well as to continue to update the apps. Developers hope you will like their app enough that you will use one of the provided in-app purchases. Without a payment method there is no chance they will be able to recoup any of their costs. Before those 2 options were available, you would have to pay to download most apps without being able to see if you even liked them.

With that said, adding a card as your payment method is much safer than using the card any place else. When using Apple Pay with your card, the credit card number is not sent to the retailer and they only receive a one time use unique number to process the payment. You are more likely to have your card compromised from a card skimmer attached to a terminal in a retail store or gas station where your credit card number is captured.

While it is possible to create and use an AppleID account without a registered payment method, you’ll not be able to download or update any Apps - paid, free or otherwise - without some form a registered payment method.

Many so-called “free” Apps either have in-App purchases, or require activation of a service subscription - both of which require a payment method to be associated with your AppleID account.

See >>> Change, add, or remove Apple ID payment methods - Apple Support

If you only have a single Credit Card set-up for your AppleID account, you will need to add a new Credit Card to your AppleID account - after which you will be able to delete the old card details. 

It is often a good idea to have two (or more) payment cards associated with your account - as, in case there is a problem with your primary card, a charge can be made to the second card without risk of impacting ongoing access to your AppleID account or associated services and subscriptions. With multiple Credit Cards, you can choose the sequence in which card payments are made.

You may find these support pages to be helpful:

If you need to change or update your Apple ID payment method - Apple Support

Add a payment method to your Apple ID - Apple Support

Remove a payment method from your Apple ID - Apple Support

Payment methods that you can use with your Apple ID - Apple Support