The “forgot password” link in the login form is generated based on the plugin’s User Profile page setting. The return link in the password reset email is also built from this same setting.
Generally, this page will contain the [wpmem_profile] shortcode. It is a general shortcode that handles changing a password and updating registration data for logged in users, as well as resetting a forgotten password, login, and registration for logged out users.
It is recommended that you start with and use the [wpmem_profile] shortcode as described above. However, for setups that need a little more control over things, there are alternatives. The [wpmem_form password] shortcode also handles forgotten password reset for a logged out user. It is essentially just the password portion of the [wpmem_profile] shortcode. You can potentially use the user profile page setting in the options to point to a page with [wpmem_form password] if you only want to provide a password reset.
Note that if you use [wpmem_form password] the page must not be blocked.
If you have an alternate forgot password dialog (such as the WP default, or WooCommerce), you should still set the User Profile page setting in the main options so the link is displayed. Then you can use the wpmem_forgot_link filter to change the URL the link points to.
Note that if you do not have the “user profile page” setting set in the plugin’s main options, then the forgot password link will not display in the login form, and the return URL in the password reset email will be incomplete.