Follow the steps if you want to send set password link to your contact.
1. When creating new contact
When you are adding new contact only check the field Sent SET password link and not fill the password field.
After the contact is created the email for set password link will be sent.
2. When contact is already created.
Only check the field Sent SET password link and click save. An email will be sent to the contact.
You need to have configured email SMTP in order to use this feature.