Mikestony, thanks for reaching out. I contacted both Google and Huawei. this was google answer:
I've just received an update from the specialists and they've confirmed that this error occurs, only if the Operating System of a device has been tampered with. This would also include manually upgrading the device's software.
Keeping the privacy and security of our users in mind Android Pay app was integrated in way to protect our users from security breach. It would detect the security breach of the device and take preventative measures.
Here's what we can do; I need you to get in touch with your device manufacturer and inform them about the manual upgrading. They'll be able to assist you in rectifying the error that is causing this issue.
I just emailed Huawai tonight. I will see what they say. Downloading the Full OTA image will unlock the bootloader too. That's what I did. I will let you know what they say, if and when they ever reply