What it does
Banding is one of Magic's most notoriously complex abilities. It does two things. On offense, when you attack with a band of creatures (one or more with banding, plus any others), the defending player loses the choice of how to assign your attackers' combat damage—you assign it instead. This lets you stack damage favorably. On defense, if a creature with banding blocks an attacker, you (the defender) choose how that attacker's damage is assigned among your blockers.
The biggest misconception: banding doesn't make a creature unblockable or grant evasion, and the damage-assignment trick only applies when the band actually deals/receives combat damage. Also, "bands with other" is a separate, even rarer variant.
In Commander, banding is mostly a janky curiosity. It can occasionally blow out multiplayer combat math—soaking lethal damage onto a tough blocker while a small one survives—but most players never bother learning it.
Iconic cards with Banding
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