Apple Pay Permanently Restricted

It’s not Apple Pay that is restricted, it’s your Apple Cash account. Please review the support article I linked to below.

If your Apple Cash account is restricted or locked

Apple Cash is a service that’s administered by Green Dot Bank. Contact an Apple Cash Specialist at Green Dot Bank by calling (877)-233-8552 or by calling 1-800-MY-APPLE

https://applecash.greendot.com/termsconditions/

They won’t be able to tell you anything either, they just don’t know anything. Chances are a Suspicious Activity Report (SAR) was filed and the investigation is out of the banks hands. Something in your recent transactions has triggered the banks need to report your activity. The SAR is investigated by the Financial Crimes Enforcement Network, a federal agency. They have 30 days to investigate and notify the bank of their decision. The bank will review the FiNCEN decision and make a determination on your account. The bank plays virtually no role in the decision of FiNCEN. The bank is prohibited by federal law, Bank Secrecy Act and Patriot Act, of discussing the matter.

https://www.investopedia.com/terms/s/suspicious-activity-report.asp

Since you mentioned paying your babysitter via Apple Pay, it would appear that the terms for Apple Cash would apply.

https://applecash.greendot.com/termsconditions/

Section I lists quite a few reasons for termination along with this statement:

 Our decisions may be based on confidential criteria that are essential to our operation of the Services, management of risk, and protection of Bank and other Users. We may use proprietary fraud and risk modeling when assessing the risk associated with your use of the Services. You understand and agree that such action is reasonable for us to take in order to protect us from loss and ensure the security of the Services. We reserve the right in our sole discretion to grant or deny reinstatement of your use of the Services.

Note that Apple is not a bank and Apple Cash is managed by Green Dot Bank. If the bank chooses to deny you service, there is nothing Apple can do about it.

Nobody here will be able to resolve that issue for you and have no access to your account to determine any reason. Apparently there is something going on there that violated Apple's terms and you will need to follow up with them on any resolution.