SFTP stands for Secure File Transfer Protocol. You can use it to transfer files between your workstation and our web hosting server, with encryption. Encryption protects your login credentials from interception and misuse.
With SFTP, you must use your master cPanel username and password -- you cannot use any additional FTP account you have created inside cPanel to give to others. If your goal is to encrypt your connection to transfer files, but you do NOT want to give out your master cPanel username and password, a better option would be to use a standard FTP Account created in cPanel, but enable a SSL/TLS connection inside your FTP client. This is called FTPS, and most every FTP client supports it, including the free FileZilla software.
Documentation provided by cPanel is located at:
Video demonstration, provided by cPanel, showing how to use SFTP, is below: