Informatica is a tool, supporting all the steps of Extraction, Transformation and Load process. Now a days Informatica is also being used as an Integration tool.
Informatica is an easy to use tool. It has got a simple visual interface like forms in visual basic. You just need to drag and drop different objects (known as transformations) and design process flow for Data extraction transformation and load. These process flow diagrams are known as mappings. Once a mapping is made, it can be scheduled to run as and when required. In the background Informatica server takes care of fetching data from source, transforming it, & loading it to the target systems/databases.
Informatica can communicate with all major data sources (mainframe/ RDBMS/ Flat Files/ XML/ VSM/ SAP etc), can move/transform data between them. It can move huge volumes of data in a very effective way, many a times better than even bespoke programs written for specific data movement only. It can throttle the transactions (do big updates in small chunks to avoid long locking and filling the transactional log). It can effectively join data from two distinct data sources (even a xml file can be joined with a relational table). In all, Informatica has got the ability to effectively integrate heterogeneous data sources & converting raw data into useful information.