In organic solar cells with very small energetic-offset (& UDelta;ELE - CT), the charge-transfer (CT) and local-exciton (LE) states strongly interact via electronic hybridization and thermal population effects, suppressing the non-radiative recombination. Here, we investigated the impact of these effects on charge generation and recombination. In the blends of PTO2:C8IC and PTO2:Y6 with very small, ultra-fast CT state formation was observed, and assigned to direct photoexcitation resulting from strong hybridization of the LE and CT states (i.e., LE-CT intermixed states). These states in turn accelerate the recombination of both CT and charge separated (CS) states. Moreover, they can be significantly weakened by an external-electric field, which enhanced the yield of CT and CS states but attenuated the emission of the device. This study highlights that excessive LE-CT hybridization due to very low , whilst enabling direct and ultrafast charge transfer and increasing the proportion of radiative versus non-radiative recombination rates, comes at the expense of accelerating recombination losses competing with exciton-to-charge conversion process, resulting in a loss of photocurrent generation.