Netcat is a tool that can be used for port scanning, banner grabbing, file transfer, remote shell access, and chatting over networks using TCP or UDP. It allows viewing open ports on a system through port scanning. Banner grabbing determines the service, version, and OS by connecting to an open port. File transfer and chat are done by setting up Netcat in server and client modes. Remote shell access can be provided through a bind shell, which binds a shell like cmd.exe to a port, or a reverse shell, which sends a shell from the client to a listening Netcat server.