PPC traffic simply means 'pay per click' traffic. This means that the affiliate will pay the advertising network every time your website or advertisement is clicked by a visitor of an external site, for example a search engine.
PPC ads are typically served on search engines or content based websites.
As the advertiser you still pay for the traffic in the way you normally would for example if you are paying per lead, you would still pay for each lead. The affiliate takes the risk of being for each click in the hope that the cost of the clicks will be less than the cost of the leads.