Without NBP, an extreme market move — for example, the 2015 SNB CHF floor removal — can blow through stop losses so fast that clients end up owing the broker money. With NBP in place, the broker is legally required to reset negative balances back to zero on retail accounts.
NBP is mandatory for retail clients under ESMA, FCA, and ASIC rules, and is offered voluntarily by some offshore brokers. Professional-client accounts (those qualifying for higher leverage) usually waive NBP — one of the real trade-offs of switching from retail to pro status.