Is Apple Pay in Italy?

If you have Apple Pay set up on your device and you have a card with a US billing address it will work anywhere that accepts NFC payments.

See this article -http://appleinsider.com/articles/14/10/21/apple-pay-already-works-internationall y-but-only-with-us-credit-cards

It will be touch and go. Some POS terminals in Europe will accept ApplePay (as long as you have a qualifying credit card as anypats has stated) but some will not. Such has been my experience in the UK and France last week. So do not rely on ApplePay as your only source of payment in Italy.

Probably store policy. Or the POS was not NFC enabled; not all are. ApplyPay is not yet available for European accounts . So you have to assume most Italian merchants are unfamiliar with it. As are many US merchants. In the US there have been reports that returning merchandise bought via ApplePay is tricky as some stores have a policy of wanting to "see" the physical card before initiating the return. Problem is that the number on the card does not match the CC number on the receipt because ApplePay uses a "virtual" CC number. The problem is solved by showing the device account number on the "back" of the CC in Passbook which is the number printed on the receipt.

There is still learning curve, which will decrease once ApplePay becomes more common.

Don't know, but my guess is no. ApplePay is built to work with NFC and not bluetooth.

I concur with FelipeV on this. ApplePay is based on NFC and not WiFi.