Muhammad bin Ishaq reported that Ibn `Abbas said that,

وَقَالُواْ قُلُوبُنَا غُلْفٌ

(And they say, "Our hearts are Ghulf."), means, "Our hearts are screened." Mujahid also said that,

The Jews used to say sarcastically that their hearts were "veiled", by which they meant that their hearts were so well protected against Islam that it could never touch them. This was their way of congratulating themselves on being staunch in their belief. The Holy Qur'an points out that this is not the firmness of faith, but a damnation, for they deny Islam which now is the true religion, and stick to a religion which has been abrogated. They, consequently, possess only "a little" faith ('Iman ایمان). Since a little faith is not acceptable, they turn out to be infidels.

The little “ faith" which they possessed pertained to the doctrines which are common to Islam and Judaism - for example, belief in Allah, or belief in the Day of Judgment. But they did not accept Sayyidna Muhammad ﷺ as a prophet, and the Holy Qur'an as the Word of Allah. So, their faith was not complete.