How does Apple Pay work?
When purchasing something from Amazon for example
iPhone 13 Pro Max, iOS 17
Apple Pay is accepted worldwide at merchants that accept Apple Pay and or Tap-To-Pay (there a few exceptions).
Apple Pay is basically a secure pipeline that sends and receives data from merchants to banks and back to merchants for transactions (purchases). The data is encrypted, and neither the merchant, Apple or your iPhone have the key to decrypt your information. This insures the security of your credit/debit cards and your personal information.
Funds are not handled by Apple. Funds Transfer directly from bank to merchant and in the case of refunds, from merchant to bank. Apple is not a bank and only handles data, not funds.
Set up Apple Pay - Apple Support
Make purchases using Apple Pay - Apple Support