Explain Wiesel’s purpose in including Madame Schächter in the memoir. What function does she serve?

Elie Wiesel, the author of Night, includes Madame Schachter as a harbinger of coming events. She serves to foreshadow the horrifying events that are coming for the Jews.
Madame Schachter appears fairly early on in the narrative. Moishe the Beadle is the first one who warns the Jews in the Hungarian ghetto what is coming. He had survived being taken and was on a mission to warn the Jews, but they would not listen.
Madame Schachter appears in chapter 2. She is with her son on the cattle cars that are taking the Jews to the concentration camps. Her husband and two older sons were deported separately from her. Elie describes her as having lost her mind. She would moan and cry and repeatedly ask why she had been separated from the rest of her family. Then, her cries become hysterical. She claims to have seen a furnace with flames roaring out of it.

On the third night, as we were sleeping, some of us sitting, huddled against each other, some of us standing, a piercing cry broke the silence: "Fire! I see a fire! I see a fire!" There was a moment of panic. Who had screamed? It was Mrs. Schächter. Standing in the middle of the car, in the faint light filtering through the windows, she looked like a withered tree in a field of wheat. She was howling, pointing through the window: "Look! Look at this fire! This terrible fire! Have mercy on me!" Some pressed against the bars to see. There was nothing. Only the darkness of night.

From this quote, you can see how the other passengers would have thought she was crazy. She woke them all up screaming about something that wasn't even there. But later on, they find out that she wasn't necessarily crazy. She had had a vision or a premonition that was absolutely correct.