The 5th Generation New Radio (5G NR) evolution has mainly been focused on three pillars: enhanced Mobile Broadband (eMBB), Ultra-Reliable Low-Latency Communications (URLLC), and massive Machine-Type Communications (mMTC). While eMBB and URLLC focus on high-performance applications and mMTC cater for low-power and low-throughput massive IoT, a considerable void has appeared in price performance ratio for mid-level IoT use cases. Examples of such use cases include industrial sensors, wearables, and video surveillance, all of which call for more than conventional mMTC technologies such as NB-IoT and LTE-M can offer but do not need the full and usually expensive complexity of eMBB/URLLC devices. To bridge this gap, Release 17 introduced Reduced Capability (RedCap) NR, with Release 18 further enhancing it. This survey systematically reviews 5G RedCap technology. It initially gives an account of the cellular IoT landscape, setting the agenda of the unique niche RedCap fills. A thorough technical dive into Release 17 and 18 core specifications then follows, highlighting the key methods of reducing complexity: bandwidth reduction, reduced antenna configurations, half-duplex FDD operation, and power-saving enhancements. This paper further explores the architectural impacts on the 5G network, such as BWP operation, and initial access procedures. Then detailed analyses that relate RedCap features to specific application requirements for industrial IoT, wearables, and smart cities are offered. Performance data from academia and industry reports are consolidated in this survey to give a quantitative comparison of RedCap against other cellular technologies in specific KPIs. Finally, deployment challenges are outlined, a bibliometric analysis of the current research landscape is undertaken, and concrete future directions are proposed to pave the way for further development of this important 5G IoT technology.