Sorry to resurrect this but I seem to have the same problem.
User logs in on self registration, gets a text message with the username and password. Type that into the login page that correctly they are redirected to, get looped back to the login creation screen. I can see in the title bar of the browser it very quickly tries to reach the redirect page but flashes back to the login screen. The role is not updating either.
I'm not sure where to find this screen regarding Service Categorization, any help appreciated!