SSL stands for Secure Socket Layer. Which basically encapsulates regular http traffic into encrypted traffic that only the client and the server can decrypt and understand the content of that traffic. When you SSL your traffic you basically ensure the integrity of the data being transmitted did not get comprimized or sniffed by unwanted intruders.

 As to why SSL is certificate is needed or who really needs it. Any website that stores "sensitive" information like Credit Card numbers, personal information about other people (like names and addresses, Identity Numbers, Passwords etc) or sensitive company information, should only acquire the data from the individual via a secure connection. Not only is a secure connection important to protect you (the website owner) from fraud, but it is essential to protect your customers and staff from fraud as well.

Why is it important?

Firstly, when you enter data (including passwords, credit card numbers) over a non-secure internet connection, the data is transmitted from your PC to the destination server in plain text. The fact that your browser shows a bunch of '******' for the password is simply what it shows you. Your password is still being transmitted as plain text!

So what does it matter?

Any data transmitted over the internet as plain text can be intercepted. It's as simple as that. A person with malicious intentions simply has to listen on the right ports or look in the right places to read exactly what you entered. If that data happened to be your password or your credit card number ... well, you can guess what happens after that.