• NSGs are focused on traffic into and out of the virtual network
• Many Azure PaaS offerings have their own firewall capabilities to lock down access
• It is often required to restrict a service to only specific subnets of specific virtual networks
• Service Endpoints make a specific subnet known to a specific Azure service and add optimal path to service
• The virtual firewall on the service can then be configured to allow only that specific subnet
• Service Endpoint Policies allow specific instances of services to be allowed from a virtual network which is not possible with NSG service tags

Benefits

• Improved security (point 3 above/restrict Internet access and allow access only from specific subnet)
• Optimal routing for services
  • NVA force every internet going thing through the same route
  • With Service Endpoint, Azure traffic goes through different route
• Direct traffic to MSFT
  • Use Azure backbone network
• Low maintenance/easy config

references:

MS Learn