Hi,
Sure. Normally, what merchants do is that they create an extra shipping method called "pickup at our store" with the "override shipping address" of the shipping method activated with the indications for the customer to do the pickup (like the address of the store).
Then, you can create a "collect on delivery" payment method, rename it to "pay during pickup" and link it to the "pickup at our store" shipping method. In its "price" or percentage setting, you can enter a negative value so that the payment fee will be negative when that payment method is selected. And you can use a translation override to change the text "payment fee" to what you want like "payment method discount" for example.
