The short answer is no, not in the way most organizations mean when they say backup. Microsoft's responsibility is keeping the service available and durable. Your data, and what happens to it, remains your responsibility under the shared responsibility model.
What Microsoft does provide
There are recycle bins, retention policies, litigation hold and versioning in SharePoint and OneDrive. These are genuinely useful, and they resolve many everyday mistakes.
They are also time-limited and configurable. Once a retention window passes, or a policy is changed by someone with administrative access, the protection is gone.
What the gap looks like in practice
The scenarios we see are consistent:
- A departing employee's mailbox is deleted along with their license, and the content is needed nine months later
- A folder is deleted and nobody notices until after the recycle bin window expires
- Ransomware encrypts files on a workstation, and OneDrive dutifully syncs the encrypted versions
- An administrative account is compromised and retention settings are changed
What to do about it
Add a backup that stores copies independently of the tenant, with retention matched to your actual records obligations, and confirm restores work. Then protect the administrative accounts that could disable it, because backup and identity security are the same conversation.