Customers cannot edit or delete payment methods during checkout

Here is my first attempt at addressing this.

Because the list of available payment methods is a Form API radios element each option only accepts a plain string. Therefore I cannot attach links on the stored payment method entries.

So instead if a stored payment method is selected and the customer has permission to edit it a button will appear below that says "Edit selected payment method". This will take them to the payment method edit form where they can either make changes or press the delete button to delete it. The checkout step they were on before going to the edit form is set as the return destination and they will be sent back there upon saving or deleting. The customer can then continue through checkout.

I installed this patch on my site. I only allow checkout for anonymous users. When the user attempts to edit the payment method they are taken to an access denied page. I have set the permission for allowing anonymous users to manage their own payment methods.

This patch does not touch permissions for editing payment methods. The url is built using the route for the payment entity. The only permission I had to grant to anonymous was "edit own payment methods". The code also checks for this permission before displaying an edit link to the user.

Is the url being generated in the format of /user/the-user-id-number/payment-methods/payment-method-id-number/edit?

Same problem as #3 - yes, the url is generated in that form, using commerce_payone

Not sure it's a good idea to add links in checkout redirecting you away from checkout. Pretty sure that isn't good UX as this could decrease the conversion rate IMO.

Also, if this ever gets added, this should probably be behind a checkout pane setting that allows toggling this behavior, and it should be FALSE by default.
Otherwise, the risk is to suddenly see new potentially undesired links in checkout showing up without notice.
Perhaps opening the links in modals could help (though modals might not be a good idea for mobile).

Not being able to checkout because the billing address is wrong lowers the conversion rate more than someone needing to change the billing address.

Though allowing the edit directly in checkout is better.

I agree, editing should be directly in checkout. The patch I made is a stop-gap fix which seems to have broken so I will likely be trying to do something more appropriate as a rewrite.

I agree. Editing should be directly in checkout because a large number simply close the browser window and never return if there isn't an edit button.
Patch doesn't work on checkout.