Well, the Passwords app is just the Passwords section in Settings moved out into its own app. It already exists on Windows, too, but maybe they are updating it to allow autofill without using a Chrome extension or add other features. It isn't the biggest change, just bringing attention to an existing feature that already competes with 1Password et al.
I switched to Apple Passwords and have been using the official Chrome extension for a few months. It's not as seamless as some of the password manager extensions, but has been working well enough.
