In recent years, circular business models (CBM) have become an inevitable requirement to foster improvements in environmental performance. However, the current literature rarely discusses the link between Internet of Things (IoT) and CBM. This paper first identifies four IoT capabilities including monitoring, tracking, optimization and design evolution for improving CBM performance based on the ReSOLVE framework. In a second step, a systematic literature review using the PRISMA approach analyzes how these capabilities contribute to 6 R and CBM through the CBM-6R and CBM-IoT cross-section heatmaps and relationship frameworks, followed by assessing the quantitative impacts of IoT on potential energy saving in CBM. Finally, challenges are analyzed for the realization of IoT-enabled CBM. The results show that the assessments of Loop and Optimize business models dominate current studies. IoT plays a significant role in these business models respectively through tracking, monitoring and optimization capabilities. While (quantitative) case studies for Virtualize, Exchange and Regenerate CBM are substantially needed. IoT holds the potential to reduce energy consumption by around 20-30% for referenced applications in the literature. However, the IoT hardware, software and protocol energy consumption, interoperability, security and financial investment might become main obstacles for the wider use of IoT in CBM. learn more on Elsevier