Generally payment methods are one digit alphanumeric identifiers that indicate the type of payments made to vendors or received from customers.

for example :

C= CHECK

D= Direct Deposit

S= SWIFT

T= BANK TRANSFER

Based on the countries sap standard keys will change.

The payment methods are stored in the vendor/customer master record as well on
vendor/customer line items. (The default from master record can be changed during manual
postings)