Dispatcher reported an incorrect maintenance deferral was discovered inflight; resulting in an inoperative fire extinguishing indication light; which was not allowed to be released by maintenance for flight. The flight continued to destination after communicating with the Dispatcher and Maintenance.

Narrative

Prior to departure; the #2 engine fire switch light fails to illuminate during fire test. Maintenance Control applied MEL for #2 Engine Fire Extinguisher Discharge Light Inoperative. A Test was accomplished to verify the fire bottles were properly charged; however this was done with the fire loops in the normal position; when they should have been tested in each individual channel. As a result; the fire handle light was actually inoperative for which there is no relief for this and the flight departed with the incorrect placard applied. Conferenced with Maintenance Control and the Chief Pilot inflight; to address our concerns about continuing in the event of a fire and lack of knowing if the fire would be extinguished without the light illuminating. We all agreed that if a fire were to occur in this engine the crew would still be alerted to the fire aurally with the alarm bell; and if there were a fire the best course of action would be to land at the nearest suitable airport regardless after discharging of the bottles to suppress the fire. We are all in agreement it is safe to continue to our planned destination of ZZZ.