Hi Chris,
As Andyboy says, it is possible to use phones without requiring verification. Might be an idea to check that out.
If the bank refuse to pay the charge then TfL will probably blacklist the device. If it’s not registered to a TfL account I’m not sure what then happens. It can probably be sorted out with a call to the helpdesk. They should cancel/refund the charge once it’s explained that it was supposed to be a zip card being read.
I’m with you on not understanding how this all works. I did try it once on a bus, but I’m very wary of using systems that I don’t fully understand.