I can’t remove a payment method

If your Apple ID has a large enough balance to cover whatever it is that you want to purchase, payment will always come of the balance before your credit or debit card is charged. I use iTunes gift cards to pay for everything including my family iCloud storage. I don’t know why iTunes would not take the money from your balance as long as you have enough in the balance to cover the cost of the in app purchase.

Look through this and make sure that you didn’t miss anything.

If you can't remove your last payment method or use no payment method with your Apple ID - Apple Support

Did you add another payment method before you tried removing the old card?